\u3000\u30 Beijing Zznode Technologies Co.Ltd(003007) 59 Pharmaron Beijing Co.Ltd(300759) )
Event:
The company issued the annual report of 2021. In 2021, the company achieved an annual operating revenue of 7.444 billion, a year-on-year increase of 45.00%; The net profit attributable to the parent company was 1.661 billion, a year-on-year increase of 41.68%; The net profit deducted from non parent company was 1.341 billion, with a year-on-year increase of 67.46%; The company’s annual net operating cash flow was 2.058 billion yuan, a year-on-year increase of 24.84%.
The company issued an announcement on the acquisition of Ankai Yibo biotechnology. In order to strengthen the quality control of experimental animals, optimize the company’s experimental animal supply system and strengthen the company’s ability in biosciences such as drug safety evaluation, it is proposed to acquire 100% equity of Ankai Yibo biological family planning company with its own capital of about 83.6 million yuan.
Comments:
Strong revenue growth and stable operation of the company. The company’s revenue growth in recent four years has increased year by year, with a growth rate of 45% in 21 years, with strong growth. In 2021, the company achieved a comprehensive gross profit margin of 35.99%, which has been stable at about 36% in recent three years; The net interest rate attributable to the parent company is 22.3%, which has been stable at about 22% in the past two years; The net interest rate after deducting non return to parent was 18.0%, with a year-on-year increase of 2.4 PP, and the overall operation and profit were stable.
Scale effect reduces the cost rate. During 2021, the company’s expense rate was 16.09% (year-on-year -2.09 PP), of which the management expense rate was 11.64% (year-on-year -1.07 PP), the R & D expense rate was 2.04% (year-on-year -0.01 PP), the sales expense rate was 2.09% (year-on-year + 0.28 PP), and the financial expense rate was 0.31% (year-on-year -1.29 PP). The scale effect reduced the company’s costs and expenses.
Advantageous businesses and emerging businesses grow together to promote the development of the company. In terms of laboratory service business, the company achieved a revenue of 4.566 billion yuan, a year-on-year increase of + 41.1%, a gross profit margin of 43.4%, strong biological and chemical linkage, and the contribution rate of Bioscience revenue was as high as 46.6%; In addition, in the past 21 years, it has participated in 565 drug discovery projects, 77 Chinese ind / NDA projects and 56 multinational projects, further improving the service capacity at home and abroad; In terms of CMC services, in 21 years, the revenue was 1.746 billion yuan, a year-on-year increase of + 42.9%, and the gross profit margin was 34.8%. A total of 1013 drug molecules or intermediates were served (754 pre clinical, 224 clinical I-II, 30 clinical III, 5 process validation and commercialization). The transformation and upgrading of cdmo was effective. In terms of clinical research services, the revenue in 2021 was 956 million yuan, with a year-on-year increase of + 52.0% and a gross profit margin of 10.3%. Through the integration and optimization of the organizational structure, the whole process of clinical research has been covered. In terms of macromolecules, cells and gene therapy, the company announced a revenue of 151 million yuan for the first time. The business in the United States has developed rapidly and the market share has further increased. The subsidiary pharmaron biologicsuk has begun to undertake external orders, and the future growth is worth looking forward to.
Technology and production capacity have been improved simultaneously, and the cdmo capacity of multi field, whole process and comprehensive type has been continuously enhanced. In terms of technology, the company has two technologies of biological enzyme catalysis and fluid chemistry, six technology platforms such as chemical reaction screening platform, gene coding compound library technology platform and human stem cell induced cardiomyocyte test platform, and 13455 R & D personnel, accounting for 90.2%, with strong comprehensive technical strength. In terms of production capacity, the company has carried out a number of mergers and acquisitions and expansion in various business sectors. In terms of laboratory services: the first part (12wm2) of Ningbo first Park Phase II project has been put into use, the second part (4.2wm2) has been installed internally, and the third park phase I Project (14wm2) has been constructed and is expected to be put into use in the first half of 2021. In addition, Zhaoqing chuangyao, kangruitai Ankai Yibo continues to ensure animal supply through acquisition. At present, there are nearly 1W NHP (non-human primates); The 200m2 CMC plant in Shaoxing (400m3) will be put into use in the third phase of 2024 CMC plant in the UK, and the rest will be put into use in the first phase of 2024 CMC plant in Shaoxing; Clinical research services: acquired Enyuan medicine and detaimai to strengthen medical and pharmacovigilance capabilities; Macromolecular and small gene therapy: about 7wm2 capacity will be put into use in 2023, and the acquired pharmaron biologicsuk company has begun to generate revenue.
Profit forecast: Based on the smooth transformation and upgrading of the company’s cdmo and the initial construction results of macromolecule, cell and gene therapy, according to the company’s guidelines, we raised our profit expectation for the company. It is estimated that the company’s operating revenue from 2022 to 2024 will be 10.457147.12/20.689 billion yuan, with a year-on-year increase of 40.5%, 40.7% and 40.6%; The net profit attributable to the parent company was 2.339/3.263/4.612 billion yuan respectively, with a year-on-year increase of 40.8%, 39.5% and 41.3%, corresponding to 39 / 28 / 20 times of PE from 2022 to 2024.
Risk factors: increased competition in the industry, decline in R & D investment and outsourcing demand in the pharmaceutical industry, China’s international policies, loss of core technicians and other risks.
